We have officially emerged from the economic downturn that began at the end of 2007, but for many workers, it really doesn’t feel that way. Yes, employment has finally returned to prerecession levels, but many of the jobs that have come back are inferior to the jobs that were lost.
A report by the National Employment Law Project (PDF) finds that “lower-wage industries accounted for 22 percent of job losses during the recession but 44 percent of employment growth over the past four years. Today, lower-wage industries employ 1.85 million more workers than at the start of the recession.” The report finds the opposite is true for mid-wage and higher-wage industries, with greater losses and smaller gains.
Yet it’s surprising how often I encounter cavalier attitudes toward the economic plight of working Americans.
Sunday’s Review section of The New York Times featured an op ed piece called “Fear Not the Coming of the Robots,” by the investment advisor Steven Rattner. The article features a nifty graph that you really must view to appreciate. It shows one column with bars representing occupations that used to employ large numbers of workers but have been decimated by automation. These occupations include word processors, telephone operators, computer operators, proofreaders, travel agents, and switchboard operators, among others. For each occupation, the graph shows not only the number of jobs lost but also the median wage, which tends to be in the thirties. Bars in a second column represent occupations that have gained workers, including computer systems managers, physical therapists, financial analysts, registered nurses, financial managers, and accountants. The wages for these occupations are much higher, with the lowest (for accountants) at $63,550.
Rattner concedes that technology has changed the nature of work, making advanced training increasingly necessary, and resulting in a sharp rise in income inequality. But he argues that the main culprit is globalization, not technology, “particularly the ability of companies to substitute far less expensive and increasingly skilled labor in developing countries.”
So what is Rattner’s proposed solution? “To address these very real challenges, we should be embracing technology, not fearing it. That means educating and training Americans to perform the more skilled jobs that cannot yet be performed by workers in developing countries.” I’m all for that, too, but where is the funding for this education and training going to come from? Not from a Congress that is incapable of passing legislation that invests in human capital. And how much more can young people and displaced workers mortgage off their futures for tuition loans?
There’s also the problem of those people who lack the ability to learn advanced skills even if somehow a training program were available. Rattner breezily comments, “Of course, not every worker can be retrained, and so we must help those who aren’t suitable for the new jobs through more robust social welfare programs.” Do you see any indication that Congress is about to beef up support for jobless people? I see the exact opposite. Even the idea of creating jobs through a program such as the Civilian Conservation Corps is a nonstarter in the current political climate.
So, yes, I do fear the one-two punch of robots and global competition. Rattner is like the captain of a ship who tells the passengers, “Don’t worry that the ship is sinking, because you can go merrily sailing in the lifeboats”—but the lifeboats aren’t there.